Deutsche Bank shares up on takeover talk

Shares of Deutsche Bank surged on Friday amid renewed speculation that Citigroup Inc. may be mulling a takeover offer.

The two banks have been rumored to be in talks as far back as 2003, however analysts were skeptical that there was any foundation to the swirling speculation. Citi Chief Executive Charles Prince has previously said the firm is not interested in buying any Western European banks.

Deutsche Bank shares have slumped in recent months, amid concerns that investment banks would be hurt by the declining value of U.S. home loans. Last month, Chief Executive Josef Ackermann said the company wants to boost earnings by 9% to $11.4 million by 2008.

Citigroup Chairman Charles Prince has been under tremendous pressure to cut expenses and raise the bank's stock price since last year. About a week ago, Citigroup announced plans to cut 17,000 jobs through layoffs and attrition and said it would move another 9,500 jobs to lower cost areas.

Deutsche Bank shares rose as much as 5.9% to $155.72 in early trading and were up 3.8% intraday.

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